by Marzena Czarnecka

You’re all over innovation. You love it. Love it. Maybe you’ve already put it in your mission statement or in your employee handbook. “We foster a culture of innovation,” it might say, or “We’re a company built on new ideas,” or “We’re always striving to improve our products and services,” or maybe even “We want our employees to seize the initiative and help move our company forward by exploring creative new ways of …”

Illustration Judy Kaufmann

But somehow, for some reason, none of that is translating into, anything concrete. People come to work, are productive and perform. Your bottom line’s OK, the business is growing OK, but are you innovating? Bringing new products to market? Improving your processes? Finding really creative solutions to daily challenges? If you’re really honest with yourself, the answer’s a resounding “No.” So what’s going on? Why don’t you have a culture of innovation?

Ready for a bitter pill? If you’re the leader of your company, and you don’t have a culture of innovation, it’s all your fault. “Everyone in a company – everyone, period – has the potential to be an innovator,” says Mark Burggren, president of Alberta Manufacturing Solutions. “But when it comes to really creating a culture of innovation, the tone has to be set at the top.”

But, but – hush. I know you say you love innovation. You have a suggestion box. You have brainstorming sessions. You have inspirational quotes of the month. You invest in training and seminars. You celebrate successes with grim determination. But that’s not enough. See, to really foster a culture of innovation, you have to celebrate failure. With abandon.

Do you do that?

“The thing about innovation is that it requires a culture of embracing and managing risk,” Burggren says. “One of the major foundational principles that has to be in play in an innovative company is that its people are comfortable taking risks – that they’re comfortable doing what needs to be done to bring the innovations to fruition and to market. And that means they need to feel comfortable that if they make a mistake, they won’t be crucified for it.”

Uncomfortable? Good. That’s good for innovation too. Let’s reiterate: a culture that doesn’t have any failures won’t have any worthwhile innovations. To innovate, you have to try, explore, take risks. You have to fail. Can you cope with that? Still uncomfortable? Try thinking about it this way: “A culture that innovates is a culture in which you celebrate everything you learn,” says Burggren. “Even failures.” The failure teaches you: now you know what won’t work. Fail early enough, and you’ve saved yourself and the company a costly trip down a dead end. “You want to fail fast and fail cheap.” Can you do that in your culture?

Not sure? Consider this first, then. Are you a culture of questions? For Michael Kerr, business speaker, trainer, and author of Inspiring Workplaces and Putting Humor to Work, that’s where innovative cultures begin. “The whole process starts with questions,” he says. “People in innovative work cultures develop skills and attitudes of questioning all the time.” Sound simple? It is and it’s not. A culture of questions only flourishes against a backdrop of trust. Lack of fear.

Do you have that? You’re not sure. I get it. You want to have it – but, well, you’re busy. You have a business to run! So yeah, you’ve probably squashed an idea or two, beat down some hothead with a costly idea, told someone else not to waste your time. So, where does that leave you?

Ready to start again. In particular: with your young people, your new people. “New employees are fresh. They have no baggage,” says Kerr. “Ask them, right now, on day one, for their input. On anything. Every new employee in a business, in any organization has this moment, where they stop in their tracks, look at something that’s inefficient and ridiculous, and think, ‘There must be a reason why they’re doing it this way. I can’t figure it out, and I can see three better ways, but I’m not going to say anything, because I’m the new guy.’ ” You want to catch them before that moment. Or, at that moment you want to hear those three better ways.

You’re bristling. What’s going on? Ah. New employees. Inexperienced. Those “Aha!” moments happen, sure, but there’s also a lot – a lot – of bad ideas. But remember that first lecture about accepting – nay, celebrating – failure? You really have to come around to that idea. And here’s the thing: Encouraging questions and soliciting ideas doesn’t mean you accept every single whacko one of them. However, you do have to acknowledge that they have come and explain why they’re not workable.

You need to do this for two reasons. First, as Kerr explains, if you don’t show people you value their questions and ideas, they’ll stop coming to you with them. But second – and this is just as important – after you explain to Chris why the way he wants you modify your process won’t work, maybe that’s when he gets the idea that will.

Ideas, innovation – they thrive on discussion, debate, conflict. That’s right, conflict. You want an innovative culture? You want conflict. “One of my definitions of a dysfunctional team includes the total absence of conflict,” says Kerr. “If there is no conflict, people aren’t talking about the elephant in the room.” Now, you don’t want people-screaming-at-each-other type of conflict. You want healthy conflict. “Healthy conflict focuses on the idea,” Kerr explains. Burggren agrees, and puts it this way, “An innovative culture is one where problems are attacked, not people.” Ideas are freely and openly discussed and criticized – but the originators of the ideas are not attacked, criticized or punished.

Makes sense? Yeah, you’re getting it. You’re even warming up to the idea of failure. A little bit of failure anyway. But now you’re worried. Because you have punished and squelched and have all these bad personal and company habits to break. Kerr has the solution, and it’s simple. “Make your people laugh,” he says. “The formula is that ha + ha = aha! and that’s true for a whole host of reasons.” Laughing makes people relax, right? And feel happy. And contrary to the way most businesses – and traditional business schools are run – it’s laughter and relaxation, not copious amounts of stress, that foster creativity. “Dozens of studies around the world have borne this out consistently,” Kerr says. “People in positive moods come up with better ideas. When groups do nothing more than watch comedians on video, they tend to come up with more ideas afterwards.” Now, he’s not suggesting you hold your next team meeting at the Comedy Cave – actually, yes he is. “Hold your creative meetings in fun locations. Or at least different locations. Shake things up.”

Why the frown? You don’t like this. Because, what? Too childish and goofy? Serious academic Michael Mauws, professor of business policy and strategy at Athabasca University, will comfort you. “One of my favourite quotes about creativity comes from Charles Baudelaire, who said ‘Genius is nothing more or less than childhood recovered at will,’ ” Mauws says. “What that means is you’ve got to learn to think like a child: You’ve got to figure out your own ways to do things.” And laugh goofily while you’re doing it.

Ready to try? Wait, one more thing, and this one will make you, if not laugh, at least smile. Whatever you do, do not tie innovation to cash. Seriously. I see that, “If you don’t link it to performance-metrics-and-you-don’t-reward-it-it-won’t-happen” compensation model on your desk. It’s fine as far as it goes. But innovation isn’t performance. It’s innovation. And if you create a formula or incentive system in which you’re handing out $200 cheques for ideas, well A) You’ll only breed discontent, because truly innovative, game-changing ideas tend to be collective beasts with lots and lots of fingerprints on them. And B) You’ve simultaneously, if not intentionally, punished failure. And remember where we’ve started? A culture of innovation accepts – celebrates – failure. So give your people permission to fail. And watch them innovate.

Our experts recommend:

The Power of Why, Amanda Lang, 2012Weird Ideas That Work: How to Build a Creative Company, Robert I. Sutton, 2002Imagine: How Creativity Works, Jonah Lehrer, 2012Made to Stick: Why Some Ideas Survive and Others Die, Chip & Dan Heath, 2007